Glenview has been angling for a change of control at the Naples, Fla.-based chain since May, citing multiple government investigations, earnings that continually came in below expectations and frequent management turnover, among other issues.
HMA has a $3.9 billion offer on the table from Community Health Systems, but Glenview has made clear that it views the offer as a “floor” and that the new board will find ways to strengthen Community's bid or seek out alternate proposals.
Community President and CEO Wayne Smith told Modern Healthcare after the deal was announced that it believes the offer is “fair and compelling” based on its due diligence.
The deal requires approval from 70% of shareholders in order to move forward.
Last week HMA offered to allow some of Glenview's nominees onto its board but asked to retain two or three directors for “continuity”—a compromise Glenview promptly rejected.
HMA reported on Friday that its second-quarter net income had fallen to $7.4 million, from $37 million during the same period last year. It said that bad debt increased to 30.3% of revenue, up from 27.2% in the second quarter of 2012.
It also saw same-facility admissions decline 6.7% and adjusted admissions drop 2.4%. The results were even weaker than previewed because of higher than expected legal and severance expenses.